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TMI Blog2014 (1) TMI 393X X X X Extracts X X X X X X X X Extracts X X X X ..... y a distributor or is holding a manufacturing license from its Foreign AE - The second parameter talks of examining as to whether or not the Indian AE is a full fledge manufacturer and whether it is selling the goods purchased from the Foreign AE as such or is making some value addition to the goods purchased from its Foreign AE before selling it to customers - There is not even a slightest doubt that the special bench order not only applies to a `Manufacturer', but also extends to a distributor, whether he is a bearing full risk or least risk - Such tests are applicable with full vigor to the extent applicable, to the distributors - The assessee was a full fledge distributor and as such the benefit of AMP expenses did not spill over to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rketing intangibles for the Associated Enterprise (AE). As against that, only a sum of Rs.1,02,13,645/- was reimbursed by the AE. Adding in mark-up of 14.93% on the differential amount, the TPO proposed adjustment accordingly. The assessee challenged the same before the ld. first appellate authority, who vide the impugned order dated 28.9.2012, deleted the addition by holding that the assessee is a sole distributor of Casio products in India and all the products imported from Casio Japan were sold as such without any further value addition. The AMP expenses were found to have been incurred as a part of its distribution function and the benefit accruing to the AE was only incidental benefit. Since the assessee was a full fledge distributor, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this case, some of which were distributors, while others were licensed manufacturers. While setting out 14 parameters, the Special Bench has held vide first parameter that the AO/TPO should ascertain as to whether the Indian AE is simply a distributor or is holding a manufacturing license from its Foreign AE. The second parameter talks of examining as to whether or not the Indian AE is a full fledge manufacturer and whether it is selling the goods purchased from the Foreign AE as such or is making some value addition to the goods purchased from its Foreign AE before selling it to customers. Thus there is not even a slightest doubt that the special bench order not only applies to a `Manufacturer', but also extends to a distributor, whether h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on this contention does not merit acceptance because the Special Bench order in the case of LG Electronics is applicable with full force on all the classes of the assessees, whether they are licensed manufacturers or distributors. As noticed above, it did refer to a case of distributor as well, whether bearing full or minimal risk. It was only thereafter that the matter of determination of ALP of AMP expenses, in all types of assessees, was restored to the AO / TPO in the light of the parameters laid down therein. It is clear that the Bench in the later order of BMW did not have any occasion to bestow its attention to the correctness of the application by the TPO of the aforesaid parameters laid down in the special bench order as these were ..... X X X X Extracts X X X X X X X X Extracts X X X X
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